Mobile operators get closer to their destiny as simple ISPs

Reading this morning on Techcrunch that Google’s rumoured ‘phone’ may be a data only device and that AT&T has confirmed they  will sell data only plans to customers who bring in Blackberry and Windows mobile devices has me thinking that the day when operators recognise their destiny and accept their future as simple ISPs is getting close.

There is nothing wrong with being a simple ISP (also known as a dumb pipe) of course, except maybe the name.  Traditional telecoms businesses like BT started out with content and portal ambitions in the late 1990s and backed out of that to be ISPs in recent years and I’ve thought for a long time that mobile operators will go the same way.  This is not a bad thing, running a lean and mean network can be a profitable exercise and one that adds a lot of value to society.  Electricity and water utilities have been doing this for years.  Further, embracing the future as a pipe doesn’t rule out selling content oriented services – they just need to be viable on a stand alone basis

Being a pipe is, however, a low margin business and with low margins come low ratings on stock markets which is why mobile operators have been fighting their destiny so hard.

I’m writing this morning because the news that AT&T is selling data only plans to Windows Mobile and Blackberry users means they have embraced their future as a simple ISP for those customers.  If Google starts selling a data only phone we will have operators around the world following suit.

As a brief finale the increasing ubiquity of free and cheap wifi networks is also bringing the day of reckoning forward.